Add the powdered sugar and meringue powder to the bowl of a stand mixer fitted with the whisk attachment. Whisk to combine.
4 cups powdered sugar, 4 tablespoons meringue powder
Pour in 8 tablespoons of warm water and the vanilla extract, and mix on medium-low speed until combined.
8-10 tablespoons warm water, 1 teaspoon pure vanilla extract
Turn the mixer up to medium-high and mix until soft peaks form, about 1-2 minutes.
Slowly add more water 1 teaspoon at a time until your desired consistency is achieved. To create an icing that works well for outlining and flooding cookies, lift up the whisk and let the icing drip back into the bowl. It should take 10-15 seconds to smooth out. If it is smoothing out too quickly, beat the icing for another minute. If it is taking longer to smooth out, add a little more water.
Divide the icing into small bowls and add gel food color, making as many colors as you would like.
Gel food coloring
Fit piping bags with a Wilton #3 or #4 tip. Fill the bags with icing and decorate your cookies as desired.